In 2020, lawmakers passed the West Virginia Tourism Development District Act, directly tied to the long contested reconstruction of the historic Hill Top House Hotel in Harpers Ferry.
Today, justices on the state Supreme Court considered arguments over whether the statute improperly strips local regulatory authority and voting power to benefit a single private luxury hotel project.
The legislation allowed the West Virginia Department of Economic Development to establish up to five “Tourism Development Districts” for companies investing in big projects in the smallest towns. The act exempts the projects from municipal authority and regulation.
The legislation came about after years of wrangling over a proposal by SWaN Investors to restore the Hill Top House Hotel, which first opened in 1889, burned down twice and reopened twice and continued until 2007.
The Hill Top House Hotel renovation has been envisioned as a $150 million destination with world class amenities in the historic gateway to West Virginia.
There’s not much sign of progress. Most of the hotel property is surrounded by metal fencing. Deer graze and stare at visitors.
The lawsuit over the state’s role was brought by five residents of Harpers Ferry.
They contend that by restricting Tourism Development District designations to a maximum of five towns under 2,000 in population with projects costing at least $25 million, the Legislature created an arbitrarily narrow classification.
They allege the policy was written specifically to benefit a single private developer, SWaN Hill Top Partners, LLC. And they argue that the $25 million minimum requirement and the five-town/2,000-population limit bear no rational relationship to the state’s goal of promoting tourism across West Virginia.
The plaintiffs asked the Supreme Court justices to reverse lower court dismissals and remand the case for a full trial. Justice Charles Trump, who was a state senator when the bill was passed, recused himself and Circuit Judge D. Andrew McMunn o Harrison County sat in.
Chief Justice Haley Bunn asked several times about standing — whether the petitioners, as individual Harpers Ferry voters rather than the municipality itself, can show a concrete harm to challenge the law.
“The plaintiffs have alleged an injury in the fact that their municipality has been stripped of the ability to regulate a fairly substantial piece of property, both in terms of its size and importance to the town of Harper’s Ferry,” said Bob Bastess, the attorney representing the plaintiffs.
“And if local control is lost, that that seriously affects the legal status of the residents of Harper’s Ferry, which of course include the plaintiffs as well as the effectiveness of their voting rights.”
The state commerce department, the agency being sued, was represented by the state Attorney General’s office.
Solicitor General Michael Williams said the law creates an open class: projects of at least $25 million in towns with populations of 2,000 or fewer. And he argued, the population limit fits the purpose of helping small towns manage large tourism projects. He noted that nearly 200 towns could qualify and that applications had been extended through 2030.
“The legislature was concerned with what happens when a very large project encounters a very small town, so it defines a class of towns to deal with that specific problem,” he said.
Although no other applications have come through so far, Williams said the policy could be appealing for developments in small towns like Anstead, Hawks Nest, Bramwell or Shepherdstown.
“So I think that there’s still plenty of room for people to participate in this program, and obviously, as many of y’all know much better than I do, economic development often takes time,” Williams said.
“And so now that this law is on the books, there’s still a possibility that developers will show the interest and show the initiative to then take advantage of the both the tax credits and then the specific prescriptions that exist as part of this act.”
In Harpers Ferry, officials continue to ask what is going on with the hotel, which is a regular town council agenda item.
The Corporation of Harpers Ferry sent an information request in June to the state economic development office, saying “The State has failed to administer the Tourism District or to press the owner either for action on its promises or termination of the Tourism District designation.” MetroNews got a copy through its own Freedom of Information Act request to the town.
Harpers Ferry officials asked a series of questions to their state counterparts, including a response to “The State’s measures for performance or success with respect to the Tourism District” and “The State’s plans, if any, to correct the conditions within the Tourism District.”
The final inquiry was, “Why the State believes, including the justifications for its belief, the TDD District should continue and, if so, for how long.”